Saturday Morning Links

Assorted content for your weekend reading.

- The Economist observes that the effects of climate change fall disproportionately on poorer people, rather than the wealthier ones who have caused more of the damage:

The costs of global climate change will again be unevenly (and uncertainly) distributed, but harm will often be smaller for richer, temperate countries. As a result the estimated economic loss from warming is almost certainly understated, because the nastiest effects are concentrated in places where incomes are lowest: and, correspondingly, where tumbling incomes have the smallest effect on global GDP.
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The rich are disproportionate contributors to the carbon emissions that power climate change. It is cruel and perverse, therefore, that the costs of warming should be disproportionately borne by the poor. And it is both insult and injury that the wealthy are more mobile in the face of climate-induced hardship, and more effective at limiting the mobility of others. The strains this injustice places on the social fabric might well lead to woes more damaging than rising temperatures themselves.

- Meanwhile, Richard Florida writes that inequality only exacerbates the dangers of economic downturns. And UNICEF makes the case to finally put and end to child poverty (and reduce inequality) in Canada.

- Noah Smith points out that no matter how much wealth gets linked to intangibles, economic stability and prosperity ultimately depend on actually producing goods. And Cameron Murray notes that longer-term development depends on industrial policy - which governments presently seem all too eager to leave to the few wealthy enough to shape it personally.

- Canadians for Tax Fairness calls for Canada's provinces to work on ensuring corporate transparency.

- But Jeremy Nuttall reports on Christy Clark's PR-focused response to the Mount Polley environmental disaster as an example of how governments are all too often focused only on minimizing corporate wrongdoing. And Brent Patterson points out the Trudeau Libs' decision to allow the dumping of mine waste in fish-bearing creeks as just another example of profits being put before the planet.

- Finally, Ken Neumann worries about the consequences of the Libs' obsession with courting Chinese capital regardless of its effect on Canada.

Saturday Afternoon Links

Assorted content for your weekend reading.

- Rachel West charts how higher wages and improved social supports can reduce crime rates and their resulting costs.

- Lana Payne comments on the glass ceiling still limiting the wages and opportunities available to women in the workplace. And Stephanie Langton highlights how a combination of student loan rules and income support clawbacks can stand in the way of students seeking to improve their education and career prospects. 

- Pam Palmater discusses some of the more important areas where the Libs' planned inquiry into murdered and missing indigenous women looks to fall short of what's needed. And Jonathan Sas recognizes that there's far more to be done to respond to the recommendations of the Truth and Reconciliation Commission on residential schools and repair the damage from a legacy of discrimination against First Nations.

- Carol Linnitt writes that two years after the Mount Polley tailings pond spill, British Columbia is far behind where it should be both in making up for the damage, and in preventing similar disasters from happening again. And Tara Scurr wonders why the province doesn't have any interest in protecting people's rights against corporate contamination. 

- Meanwhile, D.C. Fraser reports that Saskatchewan's pattern of regular oil spills has continued this week - and that once again, a major operator's leak detection system did nothing to identify the problem. And Mike De Souza exposes the National Energy Board's undisclosed meetings with multiple corporate leaders to grease the skids for Energy East, while Jesse Feith notes that Montreal has no plans to deal with the aftermath of a major oil spill.

- Finally, Fran Quigley discusses the unconscionable prices being charged for prescription drugs which drive massive rents to big pharma for the product of research funded by the public.

Tuesday Morning Links

This and that for your Tuesday reading.

- Andrew Jackson examines the effect of a federal minimum wage - and how it would benefit both workers and employers.

- Dylan Matthews offers a primer on a basic income, featuring this on how a secure income has little impact on individuals' willingness to work:

As noted above, a real basic income has never been implemented across a whole country, which makes macroeconomic effects hard to predict. But we do have some experimental evidence on the question of work effort, drawn from the negative income tax experiments in the US and Canada in the 1970s. Those studies found that work effort declined when a negative income tax was imposed, as predicted, but that the effect was quite small. Moreover, most of the reduction in work effort appeared to come from people taking longer stints of unemployment. That can be a bad thing, but it can also mean that people aren't settling for second-best jobs and holding out for ones that are better fits for them. That'd actually be good, economically. Additionally, the work effect reduction for young people appeared to come entirely from increased school attendance— also a desirable outcome.

Another factor is underreporting. Negative income taxes provide an incentive for beneficiaries to underreport their incomes so as to get a bigger benefit — and that's exactly what happened in the US negative income tax experiments. For the experiment in Gary, Indiana, when participants' reported incomes were cross-referenced with official government data on their earnings, the reduction in work effort went away entirely.

- Sean Holman reveals how British Columbians have been kept in the dark as to the dangers of mining activity. And Damien Gillis notes that so far, the only person punished in the wake of the Mount Polley environmental disaster was the whistleblower who lost his job for pointing out that Imperial Metals' tailings pond was about to fail.

- Finally, Carol Goar discusses how Canada's remand system represents both a glaring waste of money, and an all-too-common form of indefinite detention for people who haven't had a chance to answer the charges against them.

Wednesday Morning Links

Miscellaneous material for your mid-week reading.

- Eve-Lyne Couturier discusses the rot in the state of Canadian labour negotiations, as workers outside of the 1% are being systematically denied any of the benefit of economic growth.

- Meanwhile, Dean Baker points out that it's only by choice that the vast majority of jobs have been outsourced around the world for the sake of slashing wages, while executive and high-skilled positions have largely stayed put (with far more generous pay). And Margaret Simms highlights the effects of precarious work on workers and their families.

- Nick Carnes writes that the extremely wealthy have thus far won the U.S.' class war in terms of both representation and policy clout. And Harold Meyerson writes that burgeoning equality can be traced largely to corporations' decisions to enrich shareholders in the short term rather than investing in workers and economic development:

Lazonick looked at the 449 companies listed every year on the S&P 500 from 2003 to 2012. He found that they devoted 54 percent of their net earnings to buying back their stock on the open market — thereby reducing the number of outstanding shares, whose values rose accordingly. They devoted another 37 percent of those earnings to dividends. That’s a total of 91 percent of their profits that America’s leading corporations targeted to their shareholders, leaving a scant 9 percent for investments, research and development, expansions, cash reserves or, God forbid, raises.

As late as 1981, corporations directed a little less than half their profits to shareholders, but the shareholders’ share began rising in 1982, when Ronald Reagan’s Securities and Exchange Commission removed any limits on corporations’ ability to repurchase their own stock and when employers — emboldened by Reagan’s destruction of the federal air traffic controllers’ union — began large-scale union-busting. Buybacks really came into their own during the 1990s, when the pay of corporations’ chief executives became linked to the rise in the value of their company’s shares. From 2003 through 2012, the chief executives of the 10 companies that repurchased the most stock (totaling $859 billion in aggregate) received 58 percent of their pay in stock options or stock awards. For a CEO, getting your company to use its earnings to buy back its shares might reduce its capacity to research or expand, but it’s a sure-fire way to boost your own pay. 

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What Lazonick has uncovered is the present-day American validation of Piketty’s central thesis that the rate of return on investment generally exceeds the rate of economic growth. Indeed, Lazonick has documented that wealth in the United States today comes chiefly from retarding businesses’ ability to invest in growth-engendering activity. The purpose of the modern U.S. corporation is to reward large investors and top executives with income that once was spent on expansion, research, training and employees. To restore a more socially beneficial purpose, Lazonick proposes scrapping the SEC rule that permitted rampant stock repurchases and requiring corporations to have employee and public representatives on their boards.

Lazonick’s article does nothing less than decode the Rosetta Stone of America’s economic decline. The reason only luxury and dollar stores are thriving, the reason German companies outcompete ours, the redistribution of income from workers to investors – it’s all here, in Lazonick’s numbers.

The lesson for Labor Day 2014 couldn’t be plainer: Unless we compel changes such as those Lazonick suggests to our model of capitalism, ours will remain a country for investors only, where work is a sucker’s game.

- Trish Hennessy looks at the numbers behind the Lac-Mégantic rail explosion. And Jenny Uechl reports that the public will likely be left with much of the bill for the Mount Polley spill.

- Finally, Duncan Cameron reminds us that a combination of core support and low voter turnout might well leave some opportunity for the Cons to cling to power after 2015. But in noting that possibility, it's also worth highlighting the need to counter the former, work on improving the latter, and demand change to the system which allows for false majorities, rather than merely accepting whatever seems like the easiest alternative to put a new face in the PMO.

Wednesday Morning Links

Miscellaneous material for your mid-week reading.

- George Monbiot discusses how a market-based society makes people unhealthy in a myriad of ways - and how it's worth maintaining our innate reluctance to value everything and everybody around us solely in terms of dollar values:

The market was meant to emancipate us, offering autonomy and freedom. Instead it has delivered atomisation and loneliness.

The workplace has been overwhelmed by a mad, Kafkaesque infrastructure of assessments, monitoring, measuring, surveillance and audits, centrally directed and rigidly planned, whose purpose is to reward the winners and punish the losers. It destroys autonomy, enterprise, innovation and loyalty, and breeds frustration, envy and fear. Through a magnificent paradox, it has led to the revival of a grand old Soviet tradition known in Russian as tufta. It means falsification of statistics to meet the diktats of unaccountable power.

The same forces afflict those who can’t find work. They must now contend, alongside the other humiliations of unemployment, with a whole new level of snooping and monitoring. All this, Verhaeghe points out, is fundamental to the neoliberal model, which everywhere insists on comparison, evaluation and quantification. We find ourselves technically free but powerless. Whether in work or out of work, we must live by the same rules or perish. All the major political parties promote them, so we have no political power either. In the name of autonomy and freedom we have ended up controlled by a grinding, faceless bureaucracy.

These shifts have been accompanied, Verhaeghe writes, by a spectacular rise in certain psychiatric conditions: self-harm, eating disorders, depression and personality disorders.
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So, if you don’t fit in, if you feel at odds with the world, if your identity is troubled and frayed, if you feel lost and ashamed – it could be because you have retained the human values you were supposed to have discarded. You are a deviant. Be proud.

- And Brian Bethune highlights the end of connections to neighbours (and any associated "social immune system") as an increasingly worrisome social trend in Canada.

- Douglas Skinner points out that major U.S. companies are increasingly obsessing over the extraction of cash (both through repurchases and dividends) at the expense of any sustainable development. And digby links the obscene profits for the U.S.' privileged few to the excessive borrowing required of anybody else wanting to live what's seen to be a normal life.

- Alexander Knight traces the incestuous relationship between oil money and political power across Canada. Fern Hill focuses in particular on Enbridge's apparent attempt to buy favour with police departments in communities which are likely to see opposition to its Line 9 project. And Dermod Travis connects crony capitalism to the Mount Polley tailings pond spill:

Since 2005, Imperial Metals has donated at least $149,890 to the BC Liberals. With a win, place and show wager, that total includes $2,500 to each of the leadership campaigns of Christy Clark, Kevin Falcon and George Abbott. It also tossed $3,000 into the kitty for Bill Bennett's 2009 re-election campaign.

Mount Polley got in on the action as well, with the mine topping up donations to the Liberals by $46,720.
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Giraud -- then vice-president, corporate affairs at Imperial Metals -- called on the B.C. government to retain the flow-through tax credits for the exploration industry, to keep the PST off capital investments for mining companies and, most importantly, to reduce the approval process for a new mine from upwards of 10 years to as little as three.

As he noted to the committee: "I think if we're really looking for some flexibility on budget in terms of the mining sector, there is perhaps some wiggle room, but it needs to be in the context of 'I'm going to build a mine in three years, so maybe I'll tolerate those additional tax rates.' People are willing to pay for certainty and for time."

Lo and behold, six months later the BC Liberal Party was promising voters that it would streamline the mining application processes, work with the federal government to ensure mining projects undergo only one environmental review process, and that it would extend the new mine allowance and other credits allowing new mines and mine expansions to receive depreciation credits of up to 133 per cent to 2020.
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There was one last thing about Giraud's presentation that jumped out. Arguing his case for a shorter approval process, he claimed: "Nobody trusts experts anymore from an NGO or from a third party, saying: 'You know what? We don't trust what you've done.'"

After Mount Polley, that can be marked down as famous last words.

- Richard Brennan reports on a federal-provincial program which will provide money for affordable housing in Toronto. But as Brennan notes, the real story lies in what isn't included: the city is barred from using a dime of it for maintenance rather than new construction, meaning that the senior levels of government will maximize their photo ops while actively refusing to do anything to maintain the existing (and equally necessary) housing stock.

- Finally, Frances Russell weighs in on the continued clash in values between a progressive Canadian public and a hard-right Con government. But Paul Adams notes that based on current popular support, that conflict could be resolved in the next federal election by a Con collapse into third place among federal parties.

Tuesday Morning Links

This and that for your Tuesday reading.

- Jack Peat argues for trickle-up economics to ensure that everybody shares in our common resources (while also encouraging economic development):

Good capitalism is the ability to promote incentives and opportunity in equal measure. Sway too far one way and the potential of human capital is stifled, sway too far in the other direction and the willingness to realise this potential also goes amiss. Of late, bad capitalism has manifested itself in incentives over opportunities, and has become a parasitic drag on our economic growth as a result.

A recent IMF study has caused quite a stir in the western world, finding inequality can sabotage a market economy and can be a hindrance on economic growth. The findings point to the fact that, particularly in the US, things like food stamps, universal health care and perhaps a few other basic human rights might actually be a good idea. Not that we can now all go home feeling a little better about ourselves at night, but it actually makes economic sense.
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The IMF and S&P reports present politicians with a chance to act on inequality based on prudent economic factors. Rather than place spikes on doorsteps to prevent the homeless from getting shelter or squandering millions of pounds on water cannons to prevent the next London riots we could consider the impact trickle up economics could have on everyone, rather than the few. If “income distribution is robustly associated with higher and more durable growth”, why not consider passing a bit of wealth through the poor fellow’s hands?  Trickle up will benefit us all.

- Iglika Ivanova discusses how the B.C. Libs are using their own reckless tax slashing along with false spin about "affordability" as an excuse to needlessly attack health care and education:

The provincial government’s decision to underfund health care and education has nothing to do with affordability as defined by our ability to pay...

 

To sum it up: our ability to pay for education, and other much-needed public services, depends on two things: the size of our economy and our tax rates.

Our economy is not booming, but the BC budget projects it to grow by 19% over the next 5 years. This is before adjusting for inflation, but so is the BC government’s estimate that teachers’ demands for wages, class size and composition funding would add up to 14.5% over five years. Future economic growth would easily cover those.

Is it reasonable to expect that economic growth will translate into improvements in education? I’d say so.
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The thing to keep in mind is that governments choose how much revenue they have available to spend on programs by setting tax rates. Saying there’s no money in the budget for education improvements doesn’t mean we can’t afford it. It just means we can’t fund them with our current taxes.

- Barbara Yaffe writes that the Clark Liberals have given British Columbians nothing but reason to doubt that their province's environment is safe from industrial disasters. Michael Smyth discusses the history of deregulation that led to the Mount Polley tailings pond failure - and figures to lead to far more tragedies to come. And Michal Rozworski examines the broader policy issues surrounding Mount Polley.

- Meanwhile, Marc Jaccard explains why a moratorium on new tar sands development makes a world of sense if we have any interest in combating climate change. (Spoiler alert: the Harper Cons have no interest in combating climate change.) And in an example of the hidden effects of underregulation, Matthew Yglesias points out the connection between lead contamination and all kinds of social problems.

- Finally, Gareth Kirkby writes that we should expect charities to fight back against the Cons' abuses of power rather than allowing themselves to be silenced. And Dean Beeby reports that foreign aid charities in particular are starting to do just that.